[Federal Register Volume 86, Number 43 (Monday, March 8, 2021)]
[Notices]
[Pages 13410-13411]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2021-04657]
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SECURITIES AND EXCHANGE COMMISSION
[SEC File No. 270-429, OMB Control No. 3235-0480]
Proposed Collection; Comment Request
Upon Written Request, Copies Available From: Securities and Exchange
Commission, Office of FOIA Services, 100 F Street NE, Washington, DC
20549-2736
Extension:
Rule 9b-1
Notice is hereby given that pursuant to the Paperwork Reduction Act
of 1995 (``PRA'') (44 U.S.C. 3501 et seq.), the Securities and Exchange
Commission (``Commission'') is soliciting comments on the existing
collection of information provided for in Rule 9b-1, Options Disclosure
Document (17 CFR 240.9b-1), under the Securities Exchange Act of 1934
(15 U.S.C. 78a et seq.). The Commission plans to submit this existing
collection of information to the Office of Management and Budget
(``OMB'') for extension and approval.
Rule 9b-1 (17 CFR 240.9b-1) sets forth the categories of
information required to be disclosed in an options disclosure document
(``ODD'') and requires the options markets to file an ODD with the
Commission 60 days prior to the date it is distributed to investors. In
addition, Rule 9b-1 provides that the ODD must be amended if the
information in the document becomes materially inaccurate or incomplete
and that amendments must be filed with the Commission 30 days prior to
the distribution to customers. Finally, Rule 9b-1 requires a broker-
dealer to furnish to each customer an ODD and any amendments prior to
accepting an order to purchase or sell an option on behalf of that
customer or when approving a customer's account for options trading.
There are 16 options markets \1\ that must comply with Rule 9b-1.
These respondents work together to prepare a single ODD covering
options traded on each market, as well as amendments to the ODD. These
respondents file approximately 3 amendments per year. The staff
calculates that the preparation and filing of amendments should take no
more than eight hours per options market. Thus, the total time burden
for options markets per year is approximately 384 hours (16 options
markets x 8 hours per amendment x 3 amendments). The estimated cost for
an in-house attorney is $420 per hour,\2\ resulting in a total internal
cost of compliance for these respondents of approximately $161,280 per
year (384 hours at $420 per hour).
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\1\ The sixteen options markets are as follows: BOX Exchange
LLC, Cboe BZX Exchange, Inc., Cboe C2 Exchange, Inc., Cboe EDGX
Exchange, Inc., Cboe Exchange, Inc., Miami International Securities
Exchange LLC, MIAX Emerald, LLC, MIAX PEARL, LLC, Nasdaq BX, Inc.,
Nasdaq GEMX, LLC, Nasdaq ISE, LLC, Nasdaq MRX, LLC, Nasdaq PHLX LLC,
Nasdaq Options Market (NOM), NYSE Arca, Inc., and NYSE American LLC.
\2\ SIFMA did its last annual survey in 2013 and will not resume
the survey process. Accordingly, the $420 figure is based on the
2013 figure ($380) adjusted by the inflation rate calculated using
the Bureau of Labor Statistics' CPI Inflation Calculator. The $380
per hour figure for an Attorney is from SIFMA's Management &
Professional Earnings in the Securities Industry 2013, modified by
Commission staff to account for an 1800-hour work-year and
multiplied by 5.35 to account for bonuses, firm size, employee
benefits and overhead.
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In addition, approximately 1,020 broker-dealers \3\ must comply
with Rule 9b-1. Each of these respondents will process an average of 3
new customers for options each week and, therefore, will have to
furnish approximately 156 ODDs per year. The postal mailing or
electronic delivery of the ODD takes respondents no more than 30
seconds to complete for an annual time burden for each of these
respondents of approximately 78 minutes or 1.3 hours. Thus, the total
time burden per year for broker-dealers is approximately 1,326 hours
(1,020 broker-dealers x 1.3 hours). The estimated cost for a general
clerk of a broker-dealer is $63 per hour,\4\
[[Page 13411]]
resulting in a total internal cost of compliance for these respondents
of approximately $83,538 per year (1,326 hours at $63 per hour).
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\3\ The estimate of 1,020 broker-dealers required to comply with
Rule 9b-1 is derived from Item 12 of the Form BD (OMB Control No.
3235-0012). This estimate may be high as it includes broker-dealers
that engage in only a proprietary business, and as a result are not
required to deliver an ODD, as well as those broker-dealers subject
to Rule 9b-1.
\4\ The $63 figure is based on the 2013 figure ($57) adjusted
for inflation. See supra note 2. The $57 per hour figure for a
General Clerk is from SIFMA's Office Salaries in the Securities
Industry 2013, modified by Commission staff to account for an 1800-
hour work-year and multiplied by 2.93 to account for bonuses, firm
size, employee benefits and overhead. The staff believes that the
ODD would be mailed or electronically delivered to customers by a
general clerk of the broker-dealer or some other equivalent
position.
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The total time burden for all respondents under this rule (both
options markets and broker-dealers) is approximately 1,710 hours per
year (384 + 1,326), and the total internal cost of compliance is
approximately $244,818 per year ($161,280 + $83,538).
Written comments are invited on: (a) Whether the proposed
collection of information is necessary for the proper performance of
the functions of the Commission, including whether the information
shall have practical utility; (b) the accuracy of the Commission's
estimates of the burden of the proposed collection of information; (c)
ways to enhance the quality, utility, and clarity of the information
collected; and (d) ways to minimize the burden of the collection of
information on respondents, including through the use of automated
collection techniques or other forms of information technology.
Consideration will be given to comments and suggestions submitted in
writing within 60 days of this publication.
An agency may not conduct or sponsor, and a person is not required
to respond to, a collection of information under the PRA unless it
displays a currently valid OMB control number.
Please direct your written comments to: David Bottom, Director/
Chief Information Officer, Securities and Exchange Commission, c/o
Cynthia Roscoe, 100 F Street NE, Washington, DC 20549, or send an email
to: [email protected].
Dated: March 2, 2021.
J. Matthew DeLesDernier,
Assistant Secretary.
[FR Doc. 2021-04657 Filed 3-5-21; 8:45 am]
BILLING CODE 8011-01-P